MATTHEW HASSALL – Corporate Assessments Manager – Revenues & Benefits Unit – Manchester City Council & COLIN BILLINGSLEY – Department of Work & Pensions (DWP)
Matthew & Colin will update us on the impact the roll out of Universal Credit is currently having on landlords and tenants.

Also

As seen on Channel 5’s TV programme – CAN’T PAY WE’LL TAKE IT AWAY!!

From the Company behind the hit series: JASON CRITCHLEY – Business Development Manager – DCBL Bailiffs & High Court Enforcement Officers

Jason will explain the different options of Debt Recovery, Possession Order Enforcement, Costs and how quickly can you get your property back.

*Please can you inform the office either by email: admin@northwestlandlords.com or by ringing the office on 01204 495 595 to book your place*

We will of course have the last 30 minutes for time to network with tonight’s speakers, guests and other members.

We have arranged for tea, coffee and biscuits to be available from 7.30 pm, the meeting will start at 8.00 pm prompt.

A recent query on terminating a tenancy on the grounds of rent arrears gave me pause for thought. No-one can doubt my understanding towards landlords who are patient and sympathetic when arrears accrue – perhaps more sympathetic than they should be, accepting excuses far more readily than I would. The landlord I spoke to seemed to have taken all my advice about being aware of arrears a little too much to heart and was over-anxious about his rent.

The tenant was accepted and had been open that he would require housing benefit; however, he had paid 2 months’ rent in advance when his tenancy started on 1st September. The rent was paid for September and October and the next rent, due on 1st November, had not been paid. I do not know what the tenancy agreement said so do not know whether it said the rent was payable 2 months in advance so therefore was already 2 months in rent arrears or whether it was payable monthly, but evicting on a rent arrears ground under the circumstances outlined would be difficult. Even worse, it plays into the hands of those who feel that landlords are money-grabbing and uncaring.

Of course, landlords should be aware of when rent is due and take steps when arrears start to accrue, but accepting a housing benefit/Universal Credit dependent tenant and not understanding that this will almost inevitably cause delays. It would also be very difficult to maintain rent payments in advance and jumping on them when the rent payment is a couple of days late does take it to extremes. By all means, write a short but pleasant letter so they know that you are on top of the situation. That should prompt the tenant to contact housing benefits/DWP to find out exactly what is happening with the claim.

The situation with this tenant could be worthy of the landlord’s anxiety, but it is really too early to tell. He could also be the model tenant, who had acted responsibly to get 2 months’ rent in advance at the start of the tenancy. A little patience could build a really strong landlord and tenant relationship.

So says the Residential Landlord Association responding to a Citizens Advice Bureau (CAB) report on the Private Rented Sector.

They start by stating there is “comparatively little regulation” of the private sector. As landlords pick themselves up off the floor in shock, they will be delighted to know that the RLA strongly refute this, basing this on facts alone.

There are 100 Acts of Parliament containing over 400 individual regulations that private landlords must comply with. Increased regulation in the private sector would be unlikely to have a positive effect. There have been huge improvements in standards in the private sector over the last 20 years, much of it voluntarily due to accreditation schemes. If further legislation is introduced, it is likely to discourage landlords from taking the most vulnerable and those most in need of accommodation.

CAB and Shelter make no acknowledgement of statistics that show 84% of private sector tenants are perfectly satisfied with their accommodation – social landlords would envy such statistics as dissatisfaction rates for social tenants are far higher.

Chris Town, the Vice Chairman of the RLA, is clear that tenants must be protected and criminal landlords eradicated from the sector. Mr. Town stated “Rather than pile yet more regulations on the sector, what is needed is better enforcement of existing powers, which hard-pressed councils already find difficult to enforce”.

Would further regulation be matched by the equivalent enforcement staff and powers to adequately police the increased legislation? Further cuts now being discussed for 2016 and 2017 lead me to doubt this. Landlords will respond better to working with local authorities and not being treated as the enemy, as we have found in Bolton – an authority who listen to landlords. Landlords should listen to what their landlord associations tell them and want to raise standards due to common decency and a desire to practice good management. Agitators will continue to call for more legislation and the only way to combat that is by raising standards voluntarily.

The second reading of M.P. Sarah Teathers’ private members bill on Retaliatory Eviction took place on 28th November. This sought to limit the extent to which landlords may end a tenancy using a S.21 notice, the Accelerated Possession Procedure.

Whilst the S.21 notice, where no reason has to be given to end a tenancy, is the most straightforward means of gaining possession, it is often used by landlords where there are rent arrears and/or anti-social behaviour. Where arrears exceed 8 weeks, or there is severe anti-social behaviour, there is always the option of a S.8 notice – but this marks the tenant out as a bad tenant. Use of a S.21 does not require the landlord to reveal that there have been problems in the tenancy. This therefore means the tenant can go on to make a fresh start somewhere else. Now its’ use will be severely restricted.

How many landlords have had tenants who don’t report repairs, but are happy to talk about them to Housing Advice, Shelter or the CAB? They will be unable to use a s.21 as it will be seen as a retaliatory eviction. Many, many landlords behave in a kinder and more generous way than some tenants deserve. They want to provide decent properties – it is their investment that is deteriorating! But they are hampered by tenants who don’t know how to combat condensation (keeping rooms ventilated), by not having sufficient ventilation between cold walls and furniture items, by expecting landlords to be mind readers. A far more likely scenario is the tenant who is misbehaving and, following a conversation where the possibility of eviction is raised, suddenly discovers that the property is in a poor condition and reports it, so a S.21 cannot be issued.

Are M.P.’s so short-sighted that they cannot believe that these steps, far from protecting tenants and raising standards, will make it harder for some of the most vulnerable to find acceptable properties? Why should a landlord take a risk on a tenant when he has no certainty that he can recover possession by use of a S.21? Simply on the basis that they are vulnerable, they may live in poor conditions, be unable to keep a property the way it should be and therefore, allow repairs to go unreported – at which point, a helpful visitor will suggest a complaint is needed.

Should it eventually become law, then new tenancies must include provision for a monthly inspection to ensure all is okay in the property, which may stop needless complaints being used and you being unable to issue a S.21.

Tenants will always feel every repair is urgent, but whilst all repairs require a response, some require a more urgent response than others.

The ones I would advise that most thought and attention are given to them are those that affect heating and hot water and anything that concerns water.

When a tenant says the boiler is not working and they therefore have no heating or hot water, you must take whatever steps you can to bring it back to working order. You may have a regular plumber you use, but in the middle of Winter, it may be difficult to get him out – if he is good, he will be inundated with work!

Unless you are sure he will get round the same day, a policy with the gas board, utilities company or any of the other organisations which offer this kind of service, with a same day call-out guarantee, would be useful and could save unpleasantness with the tenant and local enforcement officers.

Housing Health and Safety Ratings Standard looks at cold as a serious hazard and so must a landlord. Children and the elderly are particularly vulnerable and if any reside with your tenant, it is vital that heating is maintained.

The other main issue is anything to do with water. Water ingress, leaks, must always be treated seriously because of the deterioration that can be caused to a property, some of which is not always immediately apparent. Water ingress, through poor pointing or displaced flashing can cause mould with its’ health implications. Leaks etc. must be thoroughly investigated as water left standing but unseen could cause rot in floorboards and risk ceilings collapsing. Though a noticeable bow in the ceiling could indicate a problem, there may be no noticeable signs that long-standing damp has caused rot and the ceiling is at risk.

If the ceiling does collapse, the landlord risks being held responsible for damage to tenant’s property and demands for compensation for shock or injury.

Always remember, that a property perfect at the start of the tenancy can develop problems which are not necessarily down to tenant misuse of the property. Treat complaints seriously and don’t delay in effecting whatever repair you can.

Private landlords have doubted that the DWP understood the tenants who they felt they helped by paying rent to the tenant under Universal Credit. This seems proved as, from 26th November, they will deduct 20% of the non-housing related benefit where tenants fall 8 weeks in rent arrears, with the sum collected being paid to the landlord to reduce the rent arrears.

A tenant under 25 will lose £50 per month with a couple losing £100 per month; for families with children living them, the sums would be even more. Considerable reductions which could lead to the horrors of loan sharks, stealing or quitting tenancies.

Empowerment, it seems, works when it comes to paying the rent, but not in re-paying a debt. In fact, it could be seen as disempowering of those good housing officers and landlords, who previously accepted that anyone can be tempted and fall into arrears, but worked with them to negotiate a payment plan themselves without recourse to penalising them to the extent that a 20% deduction would.

Social landlords have found their rent accounts worsening and their future funding at threat, but even they feel 20% is too much. The National Housing Federation campaigned on a basis of a 10-20% deduction, conditional on the option that social landlords could ask for lower payments where 20% would lead to hardship, but this was not acceptable to the DWP who went for a 20% deduction.

From 26th November, if a landlord informs the DWP that a tenant is 8 weeks in rent arrears, a 20% deduction will apply. Will this be the same case for private sector landlords? Time will tell, but in the spirit of equalising the situation between private and public sector, it should do. We can look forward to newspapers headlines labelling social landlords as “money-grabbing” and “rogues”, perhaps?

Is this intended as a means of collecting rent arrears or as a dis-incentive to the arrears accruing in the first place? Private landlords need to be aware of this legislation and make sure tenants know about it too – the sums taken will have a disastrous effect on their finances, stretched to the limit even without deductions.

She was introduced to the tenant by an acquaintance. He had nowhere to go; had made no provision for taking a private rented property, so had no deposit, no references from a previous landlord nor a Guarantor. These were all reasons for the landlady to put kindness to one side and allow logic and business sense to come in, but – she was a nice lady.

The tenant moved in, paid his rent for a couple of months then, disaster! He lost his job, but he was entitled to housing benefit. Yes, he was – but it didn’t get to the landlady. 8 weeks in rent arrears, she asked housing benefit to pay her direct, which they did – until the tenant started work again. He paid for another few months with tiny payments off the arrears, but then the payments stopped. After reminders, he advised he was out of work again. Back on housing benefit, payments went to him until another 8 weeks arrears had accumulated. The landlady had to request again that payments be made direct to her. All continued well – until he gained a third job. But this time, the payments reduced to a dribble.

In June, the landlady was getting desperate. There had been no rent for some months, no income to allow her to service her properties properly, something had to be done. She served him a s.8 notice, but wrote him a courteous letter, pointed out that if the rent was not paid regularly and something done to reduce the outstanding arrears, she would have no alternative but to act on the notice and seek possession through the courts. She contacted the person who had introduced him to her – he was no longer speaking to him and was not prepared to discuss the matter with him. However, the letter and notice galvanised the tenant into action. He was prepared to sign an agreement to pay the arrears. The landlady was very happy, she didn’t want to have to evict.

It did not last long. The first payment was made, then nothing. Texts were responded to with “I’ll pay you by the end of the month” – but no payment was made. His most recent contacts were “I’m leaving at the end of October”, then “I’m leaving at the end of November”. She wanted to know, should she believe him? I’ve never met the tenant, but going from his history, my answer was “no – he’s playing you along – evict”. Eviction is expensive and no landlord can be blamed for trying to avoid it, but there are times when there is no choice. This tenant is in debt. He is also trying to stay as long as possible. Is it likely that he has accumulated a deposit for a new place? I think not. Is he likely to find an equally kind landlady a second time? I sincerely hope not.

When there are substantial rent arrears, don’t make the mistake of holding off eviction because he has told you what you want to hear. Actions speak far louder than words – and the actions where there are rent arrears need to be payments.

A recent query on terminating a tenancy on the grounds of rent arrears gave me pause for thought. No-one can doubt my sympathies with landlords’ who are patient and sympathetic when arrears accrue – perhaps more sympathetic than they should be, accepting excuses far more readily than I would. The landlord I spoke to seemed to have taken all my advice about being aware of arrears a little too much to heart and was over-anxious about his rent.

The tenant was accepted and had been open that he would require housing benefit; however, he had paid 2 months’ rent in advance when his tenancy started on 1st September. The rent was paid for September and October and the next rent, due on 1st November, had not been paid. I do not know what the tenancy agreement said so do not know whether it said the rent was payable 2 months in advance so therefore was already 2 months in rent arrears or whether it was payable monthly, but evicting on a rent arrears ground under the circumstances outlined would be difficult. Even worse, it plays into the hands of those who feel that landlords are money-grabbing and uncaring.

Of course, landlords should be aware of when rent is due and take steps when arrears start to accrue, but accepting a housing benefit/Universal Credit dependent tenant and not understanding that this will almost inevitably cause delays. It would also be very difficult to maintain rent payments in advance and jumping on them when the rent payment is a couple of days late does take it to extremes. By all means, write a short but pleasant letter so they know that you are on top of the situation. That should prompt the tenant to contact housing benefits/DWP to find out exactly what is happening with the claim.

The situation with this tenant could be worthy of the landlord’s anxiety, but it is really too early to tell. He could also be the model tenant, who had acted responsibly to get 2 months’ rent in advance at the start of the tenancy. A little patience could build a really strong landlord and tenant relationship.

Government data released on 17th September 2014 shows that more than 11,000 households were claiming Universal Credit during August of this year.

This is a considerable increase on July, when 7,460 households were claiming and June, when 6,630 were claiming. As anticipated, the rate at which the programme is rolling out is accelerating.

39 job centres were processing claims for Universal Credit by mid-August and all are now accepting claims from couples, as well as single people. It is anticipated that roll-out to families will follow later this year, though dates for expansion have not been announced, yet.

Between April 2013 and August 2014, 13,260 started to claim Universal Credit; as one of the selling points of Universal Credit was that it would encourage people into work, how successful has this been? In fact, over 2,000 had moved off benefit before 14th August 2014. It is difficult to gauge how successful this is, without looking at comparable figures for a similar period before Universal Credit, it would appear that even in the very early stages, it seems to indicate that for some, at least, it has worked.

A DWP spokesman has said that by the end of 2014, “around one in eight job centres in Britain will be offering Universal Credit” and by the time Universal Credit is fully implemented, eight million people will receive their benefits by Universal Credit.

So far, results are being seen as positive, despite the arrears that social landlords now find they are struggling with. However, claims so far have been “clean” claims, the single homeless who would not, generally have multiple benefits. As it implementation progresses, the claims will become more complex. Be prepared – you may think it can’t happen yet, but you need to be ready for it. Make sure your tenants have bank accounts, tell them you understand the difficulties when their claims transfer and payment is made monthly in arrears; if your tenants have had difficulties in payment of the rent, make sure you ask them to apply for direct payments to you. Ignoring it and hoping it won’t happen won’t help; being prepared and ready for it, will.

Procure Plus is a North West consortium with 40 social landlord members. They have hired consultants to look at the feasibility of developing an off-site assembly plant, which it is believed could produce 1000 properties a year for the members and could be up and running by 2016. It would be the first of its’ kind in the social sector and would cost between £2m and £3m to develop.

I am a great fan of pre-fabricated housing, because I saw this at first hand when visiting Japan. Virtually every house there is “new” and my own little house, built in 1936, was considered quite an ancient monument!

Japanese houses are expected to last 25 years, and then start again! The home-buyer goes to a house “super-store” – a site with examples of every kind of property they build. The purchaser then chooses the rooms that are needed, the wood finishes, wall decoration, built-in furniture. Of course, with a 25 year life-span, that means that all the latest innovations are installed at the time of assembly.

Why am I such a fan? Well, no decorating for a start! Walls have a vinyl wall covering. Toilets have warm seats, a built in bidet and blow-dry facility and automatic flush – I would kill for one of those! No radiators cluttering up walls – heating is via fan heaters at ceiling height. Built-in cupboards in the lounge but little other furniture – a table and chairs and a small couch; this was used by the dog, I was told (after I had sat on it!), because others either used the dining chairs or knelt on the floor. Light switches have a small light when they are off, so no scrabbling around for a light-switch in the dark. Houses have a space on the ground floor which is for storage; in Britain, we would make it into another room, but storage is important in Japan so it is built into the properties. Bathroom and a toilet are also on the ground floor, with most of the living accommodation on the upper floors, though in the house I stayed in, there was a room on the ground floor for the grandmother of the family.

We would probably feel the living accommodation was small, with a lounge area with a table and chairs and a small, but very well-planned, kitchen. Another toilet and a washing alcove with a sink were just off the kitchen. A novelty is the “Special room”, which houses a Shinto shrine and is used only for special occasions. Upstairs were 3 bedrooms with built in wardrobes. No bathroom on the top floor! 2 of the bedrooms were quite small, though space maximised by using sliding doors. Futons Japanese sleep on are not like the European version we see in Ikea – they are thin mattresses which are folded up during the day with no supporting framework.

The one European bed in the house was slept on by the mother – a single bed. Having slept on both, I preferred the futon.

Most properties had no garage space though bicycles were left at the front. There was a small garden at the back, but very little used, other than for the dog. Japanese people prefer to go to the large ornamental parks that seem to abound, picnicking and barbecuing under the cherry blossom.

Properties built in this manner are sensibly planned and give the purchaser exactly what they want; they keep up with innovation and economies of scale are possible. I am glad that social landlords are considering the advantages of a “housing factory” – it would be nice if an entrepreneur decided to build one for private landlords to access.